Note Ban: E-tailers resume cash-on-delivery option for payment

E-commerce majors Flipkart, Snapdeal and Amazon have resumed the cash-on-delivery option for orders on their websites and apps after disabling it temporarily post the Government’s decision to demonetize Rs 500 and Rs 1,000 denomination notes.

Close to 60 per cent of the e-commerce orders are paid through the CoD channel and the recent move had hit the order volumes for the online marketplaces

While Amazon India had brought back the feature just two days after disabling it – on November 11 – Flipkart and Snapdeal has resumed it today.

According to industry estimates, close to 60 per cent of the e-commerce orders are paid through the CoD channel and the recent move had hit the order volumes for the online marketplaces. However, the companies say that the shift is beneficial from the unit of economies perspective. The companies also encouraged their customers to make online transactions and also introduced features like Wallet on Delivery and Card on Delivery, so that customers can pay using cards on their doorstep.

Online marketplaceSnapdeal, which owns Freecharge came out with ‘Wallet on Delivery’ option and says that the company witnessed 15 per cent of the orders coming from Wallet on Delivery option.

“We support the demonetisation effort by the government, and are committed to making this transition as frictionless and convenient as possible for our consumers. We worked closely with our users throughout the last week to ensure there was no lapse in their experience, and they have responded by swiftly adopting alternative payment modes, especially the Wallet on Delivery option. We will continue to monitor the situation closely, and do as required to ensure it is business as usual on our platform,” said a Snapdeal spokesperson.

Talking about the acceptance of WoD option at the Digital India Foundation event held in Delhi, Co-founder, Snapdeal, Kunal Bahl said, “People opt for CoD because a lot of people wanted the product before they pay for it. But the same can be done with the Card on Delivery or Wallet on Delivery. In fact, since the launch (of Wallet on Delivery option), 15 per cent of our orders are already coming from Wallet on Delivery option.”

Flipkart, too, said that it reached out to its customers whose orders were being processed to educate them and offer additional time to procure cash.

“Post the announcement, we took the initiative to provide every possible facility for a smooth and seamless order processing. We significantly ramped up our card on delivery facility and covered majority of pin-codes, also reaching remote towns. In the last few days, we witnessed a lot of movement towards electronic transactions and we expect the economy to further support this change. Customers are also actively using wallet cashback facilities,” Flipkart said in a statement.

The companies, however, feel sure that the surge in digital payments is bound to come down once cash is flushed back into the system. Nonetheless, they are optimistic. They feel that demonetization will help alternate payments grow organically, converting cash consumers into digital consumers.

“The equilibrium will settle at higher level than when we entered the demonetization phase. Also now our duty is to make digital payments more convenient and much more rewarding so that the customer finds depending on cash cumbersome.” Bahl said in the same event.